By Liam Gratty, Director of Strategic Services
The government’s decision to phase out ECO4 is creating uncertainty across the housing and retrofit sector. ECO4 funding has been primarily aimed at private homeowners and privately rented properties, focusing on households meeting certain eligibility criteria, such as being on specific benefits, having a low income, or living in a property with a poor EPC rating.
However, while the majority of ECO4 work sits in the private sector, registered social landlords are also affected. ECO4 has supported some projects in social housing, and its removal disrupts planning, funding assumptions, and the broader retrofit pipeline. For contractors and landlords, ECO4 has been more than just a funding source, it has underpinned the financial viability of some energy efficiency projects. Without it, many planned upgrades risk stalling, residents may face delays, and suppliers who structured teams around ECO delivery now confront immediate uncertainty.
ECO4 is not the only Government scheme coming to an end. The Great British Insulation Scheme (GBIS) will also be phased out by April 2026. While this also has implications to the housing sector, the scheme fell far short of its aim to upgrade 300,000 homes, meaning an alternative solution may have been overdue.
What this means for CHIC members and partners
“Some of our members are facing real uncertainty with ECO4 ending, and we are here to help them respond quickly. CHIC will support landlords to review affected projects, prioritise vulnerable residents and find practical ways to keep essential retrofit works moving wherever possible.”
– Stephen Sharman, Director of Member Services
“This change puts pressure on supply chains, but they won’t face it alone. CHIC will work closely with our partners to understand the immediate impact, keep pipelines stable where we can and ensure we stay connected to new opportunities with our members.”
– Mike Harris, Head of Partnerships
Project pipelines may need prompt review
Even for registered landlords, any work reliant on ECO4 in the next financial year should be reassessed. Some projects may pause, others could continue with alternative funding or reshaped scope. Landlords, contractors, and suppliers will need to plan closely together to identify what can still be delivered and where resources can be redeployed.
Budgets may come under pressure
ECO4 often made energy efficiency measures financially viable, including for some social housing projects. Without it, capital plans may need tightening or delaying, forcing difficult some decisions for landlords and delivery partners.
Clear tenant communication is important
If retrofit projects are delayed or redesigned, residents need straightforward updates. Transparent communication helps manage expectations and avoids frustration.
Quality must stay at the forefront
Recent scrutiny of installations, such as by the National Audit Office (NAO), underlines the need for strong specifications, inspections, and warranties. Even if delivery slows, maintaining standards is essential to protect residents, landlords, and the supply chain.
Supply chains face instability
Installers, manufacturers, and specialist contractors who relied on ECO4 volumes may see sudden gaps in order books, affecting cashflow and staffing. Closer collaboration between CHIC, landlords, and partners will be important to protect capacity and avoid losing skilled teams from the sector.
Moving forward together
CHIC will gather information from members and suppliers to understand which projects are affected and where support is needed, using this to guide a collective sector response. Ending ECO4 without a transition creates avoidable challenges but also provides a moment to regroup and advocate for a more stable long-term retrofit programme. CHIC will continue to support members and partners, push for predictable national policy, and help protect the skills and capacity the sector has built.
Other potential funding streams
ECO4 was great while it lasted, but it had tight rules, limited money, and couldn’t fund everything. Blended funding, or the mixing of public money such as government or council grants with other external sources of finance may offer an alternative solution delivering retrofit at scale.
Blended funding offers a more flexible solution which is highly scalable and more predictable than ECO4. This approach allows for more long term planning, offers more control over quality and increases reach to homes ECO4 did not support.
While blended funding does open up new opportunities it is not without drawbacks. It is more flexible than ECO4 but comes with more complexity, more admin, and sometimes more financial risk.
For support reviewing your projects and exploring options, contact us today at [email protected]
